March 2013
State of Real Estate (Westport Magazine)
By C.L. Hughes

Real estate involves some of the biggest decisions in our lives. It's about where to we live, where to raise our children (affecting who they will become), who we spend our time with, and an awful lot of money. Buying or selling, or just looking at the state of your current investment (your home), there's good reason to take a long hard look at the town in which you staked a claim. Here are five of the biggest issues that are going to keep you up at night, or hot opportunities that make you rest easy with optimism. It's a market to shop and play in. Here are the game changers.

To buy or not to?

Like a window or aisle seat, or sparkling or flat water, the choice between whether to buy or rent a home in recent years has seemed to have been something of a toss-up.

Putting aside financial considerations for a second-monthly rental payments and monthly mortgage payments can be fairly similar, after all-either option ends up putting a roof over your head. And because the crop of rental housing has improved by leaps and bounds in the past few years, brokers say, one often can't tell the difference between the living room of a leased or an owned property.

In 2012 that conundrum wasn't resolved unequivocally, at least in terms of what residents seemed to want.

For starters, would-be renters had a lot of options to choose among, as nonseasonal rental properties in Westport remain at historic highs. Indeed, 340 homes were rented in 2012 in town, according to data from the Greater Fairfield County Consolidated Multiple Listing Service prepared by William Raveis Real Estate.

Though that total is shy of the 383 homes rented in 2010, the data shows, it eclipses the 292 in 2008, during a super-slow market, when one might have expected desperate sellers to be renting out their houses.

And the pickings aren't slim: At the end of the year, available houses included an antique four-bedroom Colonial with a tennis court and a pool at 231 Greens Farms Road for $11,000 a month. Renting, and investing other equity elsewhere, has appeal, brokers admit.

"Sometimes renting is the best option," says Julie Vanderblue, an agent with the Higgins Group, who advised a client transplanted from Germany to rent a 5,000-square-foot stone home in Westport to decide if the town was right for them. "It's a great way to test-drive a neighborhood and a house," she adds.

More significantly, the house, which is listed at $2.5 million, could wind up being sold to renters. Under the terms of the lease deal, the renters get a right of first refusal on the house, for twelve months, at an agreed-upon price, and if they pull the trigger on a purchase, the seller will credit them a few thousand dollars of rent money toward the sale, says Vanderblue, explaining that deals like that are now common.

On the other side of the equation, the sellers have some revenue to cover their mortgage, with extra to spare. Also, by delisting the house for several months, they are also able to "freshen" the listing, by resetting the clock on its total time on the market, Vanderblue says. Plus, because the house's empty rooms are now furnished, new photos can be taken and added to the online listing.

On the other hand, buying outright has never been a better idea, brokers say, even if this mantra has been repeated for the past few years. "The real estate market is really in the bottom of the valley," says Michelle Genovesi, an agent with William Raveis Real Estate.

In fact, with interest rates continuing to drop and prices still below where they were in boom times, the numbers for buyers are very compelling, Genovesi explains. "They actually can pay less than what it costs to rent," she says, "and then have an asset to write off and have equity in."

Buyers may even have it too good. Because banks are now valuing many homes below what the market dictates, sellers are being forced to trim their prices at the last minute to make deals happen-like recently in Weston, where the owners of a 5,000-square-foot, three-bedroom had to slash $300,000 from the accepted offer price because the appraisal came in low. Genovesi says,

"They decided to negotiate."

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